Mary,Harold,Harvey,and William form an LLC (limited liability company)by contributing $20,000,$50,000,$55,000,and $150,000,respectively.The LLC is designated to be member-managed.When a decision is put to vote,Mary,Harvey,and Harold vote "yes," whereas William votes "no." Which of the following is true in this context?

Question

Quizplus · Accepted Answer

In a member-managed LLC, decisions are typically made by a simple majority vote, meaning that whichever option receives the most votes prevails. In this case, three of the four members voted "yes," which constitutes a majority, so their decision would prevail even though William contributed the most capital. Option A is incorrect because investment amount does not affect decision-making in a member-managed LLC. Option B is incorrect because a simple majority vote is sufficient to make a decision. Option D is incorrect because the decision is made by the members, not the employees.

Mary,Harold,Harvey,and William Form an LLC (Limited Liability Company)by Contributing $20,000,$50,000,$55,000,and